Basing a strategy on general maxims, such as "Sell when you double your money," "sell after two years," or "cut your losses by selling when the price falls ten per cent," is absolute folly. It's simply impossible to find a generic formula that sensibly applies to all the diferrent kinds of stocks.

Basing a strategy on general maxims, such as "Sell when you double your money," "sell after two years," or "cut your losses by selling when the price falls ten per cent," is absolute folly. It's simply impossible to find a generic formula that sensibly applies to all the diferrent kinds of stocks.

"One thing that every beginning trader needs to learn is there are a lot of ways to skin the cat," says Tommy Goelz who's been a stock trader for the past 33 years. For the past five, Goelz has been running the training program at First New York, a leading multi-strategy trading firm and one of the few remaining independent partnerships on Wall Street.

“What works for one might not work for the other, and vice-versa,” he says, and this is why he hands every incoming trader-to-be at FNY a laundry list of 40-some-odd books -- their effective summer reading. Wherever these new employees are in terms of experience -- from fresh-clipped English majors to semi-trained finance rookies -- they’re expected to knock off most of these titles. But don’t be mistaken, these books aren’t meant to teach new employees how to trade. (That happens over months or even years wedged between Goelz and other grizzled trading vets, including -- in the interest of disclosure -- my father, who's a partner at the firm). Instead, these books are meant to teach each newbie how to think, as their eyes become accustomed to the up- and downticks of the Dow Jones Industrial Average (INDEXDJXJI).

“Different things work for different people,” Goelz explains. “Now, there are certain rules of trading that are important across asset classes or across styles. How to take and manage risk would be the two most important, no matter what or how you’re trading. We focus on those things, too. But really what we are doing here is showing them the buffet [of trading styles] and letting them pick what dishes they want to eat, what will make them successful.”

Here, Goelz sits down with Minyanville and checks-off his and his team’s top picks, giving all of you future traders a heads up on the books that should probably be on your shelves, and all of you seasoned ticker-jockeys a reminder of where your fundamentals should lie.

1. Reminiscences of a Stock Operator by Edwin Lefèvre

“It’s still on my bedside table, and I pick it up every so often to read a few pages,” Goelz says of Edwin Lefèvre’s thinly veiled biography of the infamous speculator Jesse Livermore and his time on Wall Street in the early 1900s. “If you think algorithms and the speed of news have changed the game, then you’re mistaken. Just read this book.”

Reminiscences of a Stock Operator traces Livermore’s fictional counterpart Lawrence Livingston from the age of 14 into adulthood, as he cuts his teeth in so-called “New England bucket shops,” embraces his supreme talent for numbers, amasses a million-dollar fortune, and continues to lose and win it back several times over on Wall Street throughout the first two decades of the 20th century.

Reminiscences is widely considered a timeless compendium of trading wisdom, with generations turning to tried and true nuggets such as:

"A battle goes on in the stock market and the tape is your telescope.”

"I never argue with the tape. Getting sore at the market doesn't get you anywhere.”

"Speculation is a hard and trying business, and a speculator must be on the job all the time or he'll soon have no job to be on.”

Basing a strategy on general maxims, such as "Sell when you double your money," "sell after two years," or "cut your losses by selling when the price falls ten per cent," is absolute folly. It's simply impossible to find a generic formula that sensibly applies to all the diferrent kinds of stocks.

The World's 10 Most Famous Traders Of All Time
By Dan Blystone | April 15, 2015 — 12:47 PM EDT

There are several famous former traders who moved on to different careers, such as John Key (Prime Minister of New Zealand) and Jimmy Wales (founder of Wikipedia). However, this list is made up of traders famous for being traders. The lives of the world's most famous traders are colored by both triumph and tragedy, with some exploits achieving mythological status within the industry. The list begins with legendary traders of history and progresses to those of the present day.

Jesse Livermore: Jesse Lauriston Livermore (1877–1940) was an American trader famous for both colossal gains and losses in the market. He successfully shorted the 1929 market crash, building his fortune to $100 million. However, by 1934 he had lost his money and tragically took his own life in 1940.
William Delbert Gann: WD Gann (1878–1955) was a trader who used market forecasting methods based on geometry, astrology, and ancient mathematics. His mysterious technical tools include Gann angles and the Square of 9. As well as trading, Gann wrote a number of books and courses.
George Soros: Hungarian-born George Soros (born 1930) is the chairman of Soros Fund Management, one of the most successful firms in the history of the hedge fund industry. He earned the moniker “The Man Who Broke the Bank of England” in 1992 after his short sale of $10 billion worth of pounds, yielding a tidy $1 billion profit.
Jim Rogers: James Rogers, Jr. (born 1942) is the Chairman of Rogers Holdings. He co-founded the Quantum Fund along with George Soros in the early 1970s, which gained a staggering 4200% over 10 years. Rogers is renowned for his correct bullish call on commodities in the 1990's and also for his books detailing his adventurous world travels.

Basing a strategy on general maxims, such as "Sell when you double your money," "sell after two years," or "cut your losses by selling when the price falls ten per cent," is absolute folly. It's simply impossible to find a generic formula that sensibly applies to all the diferrent kinds of stocks.

Basing a strategy on general maxims, such as "Sell when you double your money," "sell after two years," or "cut your losses by selling when the price falls ten per cent," is absolute folly. It's simply impossible to find a generic formula that sensibly applies to all the diferrent kinds of stocks.

Basing a strategy on general maxims, such as "Sell when you double your money," "sell after two years," or "cut your losses by selling when the price falls ten per cent," is absolute folly. It's simply impossible to find a generic formula that sensibly applies to all the diferrent kinds of stocks.